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Act No. 40 of 2007
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Co-operative Banks Act, 2007
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| 1. |
The amendment of section 1— |
| (a) |
by the deletion of the definition of "appeal board"; |
| (b) |
by the insertion after the definition of "Agency" of the following definition: |
" 'Authority' means the Prudential Authority established in terms of section 32 of the Financial Sector Regulation Act;";
| (c) |
by the insertion after the definition of "business plan" of the following definition: |
" 'conduct standard' has the same meaning ascribed to it in terms of section 1(1) of the Financial Sector Regulation Act;";
| (d) |
by the substitution for the definition of "co-operative bank" of the following definition: |
" 'co-operative bank' means a co-operative or a co-operative financial institution registered as a co-operative bank in terms of this Act whose members—
| (a) |
are employed by a common employer or who are employed within the same business district; or |
| (b) |
have common membership in an association or organisation, including a religious, social, co-operative, labour or educational group; |
| (c) |
reside within the same defined community or geographical area;"; |
| (e) |
by the substitution for the definition of "co-operative financial institution" of the following definition: |
" 'co-operative financial institution' means a co-operative that takes deposits and chooses to identify itself by use of the name Financial Co-operative, Financial Services Co-operative, Credit Union or Savings and Credit Co-operative;";
| (f) |
by the insertion after the definition of "executive officer" of the following definition: |
" 'Financial Sector Regulation Act' means the Financial Sector Regulation Act, 2017;";
| (g) |
by the insertion after the definition of "Fund" of the following definition: |
" 'joint standard' has the same meaning ascribed to it in terms of section 1(1) of the Financial Sector Regulation Act;";
| (h) |
by the deletion of the definition of "prescribed"; |
| (i) |
by the insertion after the definition of "proposed co-operative bank" of the following definition: |
" 'prudential standard' has the same meaning ascribed to it in terms of section 1(1) of the Financial Sector Regulation Act;";
| (j) |
by the insertion after the definition of "Public Finance Management Act" of the following definition: |
" 'Register' means the Financial Sector Information Register referred to in section 256 of the Financial Sector Regulation Act;";
| (k) |
by the deletion of the definition of "supervisor"; |
| (l) |
by the insertion after the definition of "this Act" of the following definition: |
" 'Tribunal' means the Financial Services Tribunal established in terms of section 219 of the Financial Sector Regulation Act."; and
| (m) |
by the addition in section 1 of the following subsection, the existing section becoming subsection (1): |
| "(2)
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Unless the context otherwise indicates, words and expressions not defined in subsection (1) have the same meaning ascribed to them in terms of the Financial Sector Regulation Act.". |
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2. |
The insertion after section 1 of the following sections: |
"Relationship between Act and Financial Sector Regulation Act
1A.
| (1) |
Except as otherwise provided by this Act or the Financial Sector Regulation Act, the powers and duties of the Authority in terms of this Act are in addition to the powers and duties that it has in terms of the Financial Sector Regulation Act. |
| (2) |
A reference in this Act to the Authority or the Agency determining or publishing a matter by notice in the Gazette must be read as including a reference to the Authority or the Agency determining or publishing the matter by notice published in the Register.
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| (3) |
Unless expressly provided otherwise in this Act, or this Act requires a matter to be prescribed by regulation in terms of section 86, or permits a matter to be prescribed by the Agency, including in a rule in terms of section 57, a reference in this Act to a matter being— |
| (a) |
prescribed must be read as a reference to the matter being prescribed in a prudential standard, conduct standard or joint standard; or |
| (b) |
determined must be read as a reference to the Authority determining the matter in writing and registering the determination in the Register. |
| (4) |
Matters in respect of which regulations relating to co-operative banks and co-operative financial institutions may be prescribed in terms of this Act may also be prescribed in prudential standards, conduct standards or joint standards in terms of the Financial Sector Regulation Act. |
| (5) |
A reference to rules made by the Authority in terms of section 46 must be read as a reference to prudential standards, conduct standards or joint standards. |
(6)
| (a) |
A reference to an inspection in section 47 must be read as a reference to a supervisory on-site inspection or an investigation in terms of Chapter 9 of the Financial Sector Regulation Act. |
| (b) |
A reference to an investigation by the Agency or the Minister in terms of section 73 must not be read as a reference to an investigation in terms of Chapter 9 of the Financial Sector Regulation Act. |
(7)
| (a) |
A reference in this Act to the Authority or the Agency announcing or publishing information or a document on a web site must be read as a reference to the Authority or the Agency publishing the information or document in the Register. |
| (b) |
The Authority or the Agency may also publish the information or document on its web site. |
(8)
| (a) |
A reference in this Act to a prescribed fee, other than a reference to a fee prescribed by the Agency, must be read as a reference to the relevant fee determined in terms of section 237 and Chapter 16 of the Financial Sector Regulation Act. |
| (b) |
The Agency, when determining a fee in terms of this Act, must comply with the requirements of section 237 and Chapter 16 of the Financial Sector Regulation Act. |
| (9) |
A reference in this Act to an appeal of a decision of the Authority or the Agency must be read as a reference to a reconsideration of the decision by the Tribunal in terms of the Financial Sector Regulation Act. |
(10)
| (a) |
The Authority must publish the following in the Register— |
| (i) |
each registration of a co-operative bank in terms of section 8 and each suspension and de-registration in terms of section 11; |
| (ii) |
each conversion of registration in terms of section 28; |
| (iii) |
each registration of a co-operative financial institution in terms of section 40C, and each suspension, lapsing and de-registration in terms of section 40D. |
| (b) |
The Agency must publish the following in the Register— |
| (i) |
each registration of a representative body in terms of section 33, and each cancellation or suspension of registration in terms of section 35; and |
| (ii) |
each accreditation of a support organisation in terms of section 38, and each cancellation or suspension of accreditation in terms of section 40. |
Regulatory instruments
| 1B. |
For the purposes of the definition of "regulatory instrument" in section 1(1) of the Financial Sector Regulation Act, the following are regulatory instruments: |
| (a) |
existing rules made in terms of section 46 prior to the date on which this section comes into effect; and |
| (b) |
prudential, conduct or joint standards made in terms of section 46 subsequent to the date on which this section comes into effect;". |
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| 3. |
The amendment of section 2 by the substitution for paragraphs (b) and (c) of the following paragraphs: |
| "(b) |
promote the development of sustainable and responsible co-operative banks and co-operative financial institutions; and |
| (c) |
establish an appropriate regulatory framework and regulatory institutions for co-operative banks and co-operative financial institutions that protect the interests of members of co-operative banks, co-operative financial institutions, and the public, |
by providing for—
| (i) |
the registration of deposit-taking financial services co-operatives as co-operative banks or co-operative financial institutions; |
| (ii) |
the [establishment of supervisors to ensure] appropriate and effective regulation and supervision of co-operative banks and co-operative financial institutions, and to protect members and the public interest; and |
| (iii) |
the establishment of a Development Agency for Co-operative Banks to develop and enhance the sustainability of co-operative banks and co-operative financial institutions.". |
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| 4. |
The amendment of section 3 by the substitution for the section of the following section: |
"3.
| [(1)] |
This Act applies to all co-operative banks registered under this Act and to any [—
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| (a) |
primary co-operative registered under the Co-operatives Act that takes deposits and— |
| (i) |
has 200 or more members; and |
| (ii) |
holds deposits of members to the value of one million rand or more; and |
| (b) |
secondary or tertiary co-operative registered under the Co-operatives Act, whose members consist of at least— |
| (i) |
two or more co-operative banks; |
| (ii)
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two or more financial services co-operatives that take deposits; or |
| (iii) |
one co-operative bank and one financial services co-operative that take deposits] co-operative financial institution registered under this Act. |
| [(2) |
A co-operative referred to in subsection (1) must, subject to section 91, within two months of meeting the criteria referred to in subsection (1) apply for registration as a co-operative bank in terms of this Act.]". |
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| 5. |
The amendment of section 4 by the substitution for subsection (1) of the following subsection: |
| "(1) |
The Co-operatives Act applies to co-operative banks and co-operative financial institutions unless the application of a provision thereof has specifically been excluded or amended in this Act.". |
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| 6. |
The amendment of section 5 by the substitution for paragraphs (c) and (d) for the following paragraphs: |
| "(c) |
a secondary co-operative bank whose members consist of at least—
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| (i) |
two or more co-operative banks; |
| (ii) |
two or more co-operative financial institutions; or |
| (iii) |
one co-operative bank and one co-operative financial institution; and |
| (b) |
a tertiary co-operative bank whose members consist of two or more secondary co-operative banks." |
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| 7. |
The insertion after section 40 in Chapter VII of the following Chapter: |
"CHAPTER VIIA
CO-OPERATIVE FINANCIAL INSTITUTIONS
Application for registration as co-operative financial institution
40A.
| (1) |
A co-operative financial institution must apply to the Authority, or to the Agency if this function has been assigned or delegated to the Agency, for registration on the application form as prescribed. |
| (2) |
The co-operative financial institution must submit copies of documents and any other information as prescribed, together with the application form referred to in subsection (1). |
Requirements for registration
40B.
| (1) |
In order to qualify for registration, or to continue to be registered, a co-operative financial institution must demonstrate, to the satisfaction of the Authority, or to the Agency if this function has been assigned or delegated to the Agency, on an ongoing basis that— |
| (a) |
it has the requisite experience, knowledge, qualifications and competence to give effect to its obligations; |
| (b) |
it has sufficient human, financial, and operational capacity to function efficiently and competently; |
| (c) |
it meets any prescribed threshold requirements in respect of membership, membership shares and deposits held; and |
| (d) |
it meets any other applicable prescribed requirements. |
(2)
| (a) |
A co-operative financial institution must, once it has reached a prescribed amount of members’ deposits, apply for registration as a co-operative bank in terms of this Act. |
| (b) |
If the responsibility for the registration of a co-operative financial institution has been assigned or delegated to the Agency, the Agency must recommend to the Authority whether the application for registration as a co-operative bank should be approved or declined. |
| (c) |
In the event that the application by a co-operative financial institution to register as a co-operative bank is declined— |
| (i) |
the Authority may determine that the co-operative financial institution concerned may not hold members’ deposits exceeding a specified amount; and |
| (ii) |
the co-operative financial institution concerned must re-apply for registration as a co-operative bank once the requirements to register as a co-operative bank have been met. |
| (d) |
An amount determined by the Authority in terms of paragraph (c)(i)— |
| (i) |
must be based on the nature and size of the co-operative financial institution; and |
| (ii) |
may not exceed the general maximum limit for holdings of deposits by any co-operative financial institution prescribed by the Authority. |
| (e) |
An application by a co-operative financial institution for registration as a co-operative bank must be accompanied by a letter of recommendation from the Agency, if applicable. |
| (3) |
On the date that this section comes into operation, a co-operative financial institution that qualifies to be registered in terms of this Act— |
| (a) |
must apply for registration in terms of this Act within 12 months from the date on which this section comes into operation; and |
| (b) |
that holds members’ deposits exceeding a prescribed threshold, but which does not qualify to be registered as a co-operative bank, must not hold members’ deposits exceeding an amount determined by the Authority, based on the nature and size of the co-operative financial institution. |
| (4) |
If the registration of co-operative financial institutions has been assigned or delegated to the Agency in terms of the Act, the Agency must inform the Authority of the registration of a co-operative financial institution within 14 days of the registration. |
Registration of co-operative financial institution
40C.
| (1) |
The Authority may grant an application for registration on payment of the fee, prescribed by the Authority, if the Authority is satisfied that— |
| (a) |
the application has been made in accordance with this Act; and |
| (b) |
the co-operative financial institution complies with the requirements for registration referred to in section 40B. |
| (2) |
The Authority must, on registration, issue a certificate of registration to the co-operative financial institution and publish a notice of the registration in the Register. |
Suspension of registration or de-registration
40D.
The Authority may, subject to subsection (4), de-register or, where appropriate, suspend the registration of a co-operative financial institution where the Authority is satisfied that the co-operative financial institution—
| (a) |
has not commenced operating as a co-operative financial institution six months after the date of its registration as a co-operative financial institution; |
| (b) |
has ceased to operate; |
| (c) |
obtained registration through fraudulent means; |
| (d) |
no longer meets the requirements for registration referred to in section 40B; |
| (e) |
is unable to meet or maintain its prudential requirements referred to in section 40B; |
| (f) |
has failed to comply with any condition imposed under this Act; |
| (g) |
has failed to comply with any directive issued under this Act; or |
| (h) |
is de-registered or wound-up under the Co-operatives Act. |
| (2) |
Where a co-operative financial institution has requested its de-registration, the Authority may on submission of such a request, along with any other prescribed or requested information, deregister the co-operative financial institution. |
(3)
| (a) |
Where the Authority suspends the registration of a co-operative bank under subsection (1), the Authority may do so subject to any condition that the Authority may determine. |
| (b) |
The Authority may revoke any suspension under subsection (1) if the Authority is satisfied that the co-operative financial institution has complied with all the conditions to which the suspension was made subject. |
(4)
| (a) |
The Authority must publish a notice of such de-registration or suspension in the Register. |
| (b) |
The de-registration of a co-operative financial institution takes effect on the date specified in the notice referred to in paragraph (a). |
| (c) |
Where a co-operative financial institution has applied for reconsideration of the decision of the Authority referred to in subsection (1), the Authority must not publish the notice referred to in paragraph (a) until the application for reconsideration of the decision has been finalised. |
Repayment of deposits on de-registration or lapsing of registration
40E.
| (1) |
The Authority may, on the de-registration of a co-operative financial institution, direct the co-operative financial institution to repay any deposits, including interest thereon, held by that co-operative financial institution as at the date of de-registration within the period specified in the directive. |
| (2) |
A directive referred to in subsection (1) may— |
| (a) |
apply to all deposits generally; or |
| (b) |
differentiate between different types, kinds and amounts of deposits. |
| (3) |
A co-operative financial institution that fails to comply with a directive under subsection (1) is deemed not to be able to pay its debts. |
Winding-up or judicial management of co-operative financial institution
40F.
| (1) |
Despite the provisions of sections 72(1), 73(1) and 77(2) of the Co-operatives Act— |
| (i) |
apply to a court that a co-operative financial institution be wound-up; |
| (ii) |
recommend to the Minister responsible for co-operatives that a co-operative financial institution be wound-up; and |
| (iii) |
apply to a court for a judicial management order; and |
| (b) |
the Minister responsible for co-operatives may not order that a co-operative financial institution be wound-up without the written concurrence of the Authority, or the Agency, if functions of the Authority have been assigned or delegated to the Agency as contemplated in this Act. |
| (2) |
Any application to a court for the winding-up, including the voluntary winding-up, of a co-operative financial institution must be served on the Authority. |
| (3) |
Despite any other law, the Master of the High Court may only appoint a person recommended by the Authority as a provisional liquidator or liquidator of a co-operative financial institution, unless the Master is of the opinion that the recommended person is not fit and proper to be appointed as a provisional liquidator or liquidator of the co-operative financial institution concerned. |
| (4) |
A liquidator of a co-operative financial institution that is voluntarily wound-up must submit to the Authority any documents that the co-operative financial institution being wound-up would have been obliged to submit in terms of this Act.". |
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| 8. |
The repeal of sections 41 and 43. |
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| 9. |
The amendment of section 44— |
| (a) |
by the substitution for subsection (1) of the following subsection: |
| "(1) |
The [supervisor] Authority may, in writing, delegate or assign any of the powers entrusted to [him or her] the Authority in terms of this Act and assign any of the duties imposed on [him or her] the Authority in terms of this Act to [a deputy supervisor,] any person employed by the Authority or the South African Reserve Bank, to the Financial Sector Conduct Authority, or, with the concurrence of the Minister, to the Agency [a deputy supervisor or any other person]."; and |
| (b) |
by the insertion after subsection (3) of the following subsection: |
"(4)
| (a) |
To the extent that a power or function relating to the licensing of co-operative financial institutions has been delegated to the Agency, references in Chapter VIIA to "the Authority" must be read as a reference to "the Agency". |
| (b) |
A reference in Chapter VIIA to "prescribed" means "prescribed in prudential, conduct or joint standards". |
| (c) |
To the extent that a power or function relating to the licensing of co-operative financial institutions has been assigned or delegated to the Agency— |
| (i) |
the Agency may make rules in relation to the performance of that power or function; and |
| (ii) |
"prescribed" must be read as referring to "rules made by the Agency".". |
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| 10. |
The substitution for section 45 of the following section: |
| "45. |
The [supervisor] Authority, in addition to other functions conferred on the [supervisor] Authority by or in terms of any other provision of this Act— |
| (a) |
must take steps [he or she] that the Authority considers necessary to protect the public in their dealings with co-operative banks and co-operative financial institutions; |
| (b) |
may, on the written request of a co-operative bank, co-operative financial institution, representative body, support organisation or auditor, extend any period within which any documentation, information or report must be submitted to [him or her] the Authority; |
| (c) |
must determine the form, manner and period, if a period is not specified in this Act, within which any documentation, information or report that a co-operative bank, co-operative financial institution, [a] representative body, support organisation or auditor is required to submit to the [supervisor] Authority under this Act must be submitted; |
| (d) |
may, despite the provisions of any law, furnish information acquired by [him or her] the Authority under this Act to any person charged with the performance of a function under any law; |
| (e) |
may issue guidelines to co-operative banks, co-operative financial institutions, members, supporting institutions and auditors on the application and interpretation of this Act and provide them with information on market practices or market or industry developments within or outside the Republic; |
| (f) |
may publish a journal or any other publication, and issue newsletters and circulars containing information relating to co-operative banks and co-operative financial institutions; and |
| (g) |
may take any measures [he or she] that the Authority considers necessary for the proper performance and exercise of [his or her] the Authority’s functions or duties or for the implementation of this Act.". |
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| 11. |
The substitution for section 46 of the following section: |
"Power to make [rules] standards
46.
| (1) |
[The supervisor may prescribe rules with regard to—] A prudential, conduct or joint standard for or in respect of co-operative financial institutions and co-operative banks may be made on any of the following matters: |
| (a) |
[any] Any matter that is required or permitted to be prescribed in terms of this Act; and |
| (b) |
any other matter for the better implementation of this Act or a function or power provided for in this Act. |
(2) [Rules] Standards referred to in subsection (1) may—
| (a) |
apply to co-operative banks or co-operative financial institutions generally; or |
| (b) |
be limited in application to a particular co-operative bank or co-operative financial institution or kind of co-operative bank or co-operative financial institution, which may be defined in relation to either a type or budgetary size of co-operative bank or co-operative financial institution or to any other matter. |
[(3)
| (a) |
Before the supervisor prescribes any rule under this section, he or she must— |
| (i) |
publish a draft of the proposed rule in the Gazette together with a notice calling for public comment in writing within a period stated in the notice, which period may not be less than 30 days from the date of publication of the notice; and
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| (ii) |
secure the written approval of the Minister. |
| (b) |
If the supervisor alters a draft rule because of any comment, he or she need not publish the alteration before prescribing the rule. |
| (4) |
The supervisor may, if circumstances necessitate the immediate publication of a rule, publish that rule without the approval as contemplated in subsection (3)(a)(ii).]".
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| 12. |
The substitution for section 47 of the following section: |
"Inspections
47.
(1)
| [(a)] |
The [supervisor] Authority may at any time of [his or her] the Authority’s own accord, on application by at least 10 per cent of the members of or at the request of the judicial manager of a co-operative bank or a co-operative financial institution, inspect the business of a co-operative bank or a co-operative financial institution if the [supervisor] Authority has reason to believe that the co-operative bank or co-operative financial institution is not conducting its affairs in accordance with the provisions of this Act or is contravening a provision of this Act. |
| [(b)
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The supervisor has for the purposes of subsection (2) the powers and duties conferred or imposed upon a registrar by the Inspection of Financial Institutions Act, 1998 (Act No. 80 of 1998), and any reference in that Act to "registrar" must be construed as a reference to "supervisor" and any reference to "financial institution" must be construed as a reference to "co-operative bank", provided that no warrant is required for search and seizure activities aimed at establishing regulatory compliance.] |
| (2) |
The [supervisor] Authority may take any measures and make any recommendation [he or she] that the Authority considers appropriate following an inspection in terms of subsection (1), including a recommendation to— |
| (a) |
the co-operative bank or the co-operative financial institution; and |
| (b) |
the relevant prosecuting authority if the inspection was done on the authority of a warrant.". |
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| 13. |
The amendment of section 48— |
| (a) |
by the substitution in subsection (1) for the words preceding paragraph (a) of the following words: |
"The [supervisor] Authority may, in order to ensure the implementation and administration of this Act or to protect members and the public in general, issue a directive to a co-operative bank or a co-operative financial institution—"; and
| (b) |
by the substitution in subsection (2) for paragraphs (a) and (b) of the following paragraphs: |
| "(a) |
apply to co-operative banks or co-operative financial institutions generally; or |
| (b) |
be limited in its application to a particular co-operative bank or co-operative financial institution, or kind of co-operative bank or co-operative financial institution, which may be defined either in relation to a type or budgetary size of co-operative bank or co-operative financial institution or to any other matter.". |
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| 14. |
The amendment of section 49— |
| (a) |
by the substitution for subsection (1) of the following subsection: |
| "(1) |
The [supervisor] Authority may, despite and in addition to taking any step [he or she] that the Authority may take under this Act, impose an administrative penalty on [the] a co-operative bank or co-operative financial institution for any failure to comply with a provision of this Act."; and |
| (b) |
by the substitution for subsection (4) of the following subsection: |
| "(4) |
If a co-operative bank or co-operative financial institution fails to pay an administrative penalty within the specified period the [supervisor] Authority may by way of civil action in a competent court recover the amount of the administrative penalty from the co-operative bank.". |
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| 15. |
The substitution for section 50 of the following section: |
"Information and reports
50.
[(1)]
| (a) |
The [supervisor] Authority may on written notice require a co-operative bank, a co-operative financial institution, a representative body or a support organisation [of a co-operative bank] to submit to [him or her] the Authority— |
| (i) |
the information specified in the notice; or |
| (ii) |
a report by an auditor or by any other person with appropriate professional skill, designated by the [supervisor] Authority, on any matter specified in the notice. |
| (b) |
A report required under [subsection (1)] paragraph (a) must be prepared at the expense of the co-operative bank, representative body or support organisation.". |
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| 16. |
The amendment of section 55 by the insertion after paragraph (l) of the following paragraph: |
| "(lA)
|
exercise powers and perform functions in relation to co-operative financial institutions, including regulatory and supervisory functions, as specified in terms of this Act, or which the Authority may, with the concurrence of the Minister, delegate or assign to the Agency;". |
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| 17. |
The amendment of section 57— |
| (a) |
by the substitution in subsection (1) for paragraph (aA) of the following paragraph: |
| "(aA) |
the matters referred to in section 55(1)(f) to (h) and paragraph (aB) of this subsection, in consultation with the [supervisor] Authority;"; |
| (b) |
by the insertion after paragraph (aA) of the following paragraph: |
| "(aB)
|
co-operative financial institutions, in order to perform the Agency’s functions in relation to co-operative financial institutions, including regulatory and supervisory functions, as specified in terms of this Act, or which the Authority may, with the concurrence of the Minister, delegate or assign to the Agency;"; |
| (c) |
by the substitution in subsection (2) of the following subsection: |
| "(2) |
Rules referred to in subsection (1) may— |
| (a) |
apply to co-operative banks, representative bodies [or], support organisations or co-operative financial institutions generally; [or] |
| (b) |
be limited in application to a particular co-operative bank, representative body [or], support organisation or co-operative financial institution, or kind of co-operative bank or co-operative financial institution, which may be defined either in relation to a type or budgetary size of co-operative bank or co-operative financial institution, or to any other matter; and
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| (c) |
only apply to co-operative financial institutions, in the case of rules referred to in subsection (1)(aB).". |
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| 18. |
The repeal of sections 75 and 76. |
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| 19. |
The substitution for section 77 of the following section: |
"Unlawful use of word 'co-operative bank', 'co-operative financial institution' or unlawful conduct of [banking] business of co-operative bank or co-operative financial institution.
77.
| (1) |
It is an offence for any person who is not registered as a co-operative bank or a co-operative financial institution under this Act to— |
| (a) |
in connection with any business conducted by him, her or it— |
| (i) |
use or refer to himself, herself or itself by any name, description or symbol indicating, or calculated to lead persons to infer, that such person is a co-operative bank or a co-operative financial institution registered as such under this Act; or |
| (ii) |
in any manner purport to be a co-operative bank or a co-operative financial institution registered as such under this Act; or |
| (b) |
use in respect of any business a name or description that includes the expression "co-operative bank", "co-op bank", "co-operative financial institution" or any derivative thereof. |
| (2) |
It is an offence for any person to conduct the business of any co-operative bank or co-operative financial institution unless such person is registered as a co-operative bank or a co-operative financial institution in terms of this Act. |
(3)
| (a) |
It is an offence for a co-operative bank to provide, participate in or undertake banking services other than the services authorised in respect of the type of co-operative bank it is registered as in terms of this Act. |
| (b) |
It is an offence for a co-operative financial institution to provide, participate in or undertake services other than the services that it is authorised to provide as a registered co-operative financial institution in terms of this Act.". |
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20. |
The substitution for section 78 of the following section: |
"Untrue information in connection with applications
| 78. |
It is an offence for any person in connection with an application for registration as a co-operative bank or a co-operative financial institution to provide any information that to the knowledge of such person is untrue or misleading in any material respect.". |
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| 21. |
The substitution for section 79 of the following section: |
"Criminal liability of director, managing director, executive officer and other persons
79.
| (1) |
It is an offence for any director, managing director or executive officer of a co-operative bank or a co-operative financial institution to, directly or indirectly, be involved in or take part in the management of a co-operative bank or a co-operative financial institution while the business of the co-operative bank or co-operative financial institution is carried on recklessly, with intent to defraud creditors of the co-operative bank or co-operative financial institution, or creditors of any other person, or for any fraudulent purpose. |
| (2) |
It is an offence for any person other than a director, managing director or executive officer to knowingly, directly or indirectly, benefit from, be involved in or take part in the management of a co-operative bank or a co-operative financial institution while the business of the co-operative bank or co-operative financial institution is carried on recklessly, with intent to defraud creditors of the co-operative bank or co-operative financial institution, or creditors of any other person, or for any fraudulent purpose.". |
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| 22. |
The substitution for section 82 of the following section: |
"Fair administrative action
82.
[Any] Where a decision or other step of an administrative nature taken by the [supervisor,] Authority or the Agency [or appeal board that] affects the rights of another person, the [supervisor,] Authority or the Agency [or appeal board] must comply with the Promotion of Administrative Justice Act, 2000 (Act No. 3 of 2000), unless another fair administrative procedure has been provided for in this Act or in terms of the Financial Sector Regulation Act.".
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| 23. |
The substitution for section 85 of the following section: |
"Indemnity
| 85. |
Neither the [supervisor,] Authority or the Agency [or appeal board], or any board member or employee or managing director thereof, nor a committee of the Agency or any member thereof incurs any liability in respect of any act or omission performed in good faith under or by virtue of a provision in this Act, unless that performance was grossly negligent.". |
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| 24. |
The substitution for section 87 of the following section: |
"Powers of Minister
| 87. |
The Minister may delegate any of [his or her] the Minister’s powers in terms of this Act, excluding the power to make regulations and the power to appoint the members of the Agency [or appeal board], to the Director-General or any other official of the National Treasury.". |
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| 25. |
The substitution for the long title of the Act for the following: |
"To promote and advance the social and economic welfare of all South Africans by enhancing access to banking services under sustainable conditions; to promote the development of sustainable and responsible co-operative banks and co-operative financial institutions; to establish an appropriate regulatory framework and regulatory institutions for co-operative banks and co-operative financial institutions that protect members of co-operative banks and co-operative financial institutions; to provide for the registration of deposit-taking financial services co-operatives as co-operative banks and co-operative financial institutions; to provide for the regulation and supervision of co-operative banks and co-operative financial institutions; and to provide for the establishment [of co-operative banks supervisors and] a development agency for co-operative banks; and to provide for matters connected therewith".
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26. |
The substitution for the expression "supervisor", wherever it occurs, of the expression "Authority". |
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| 27. |
The amendment of the arrangement of sections— |
| (a) |
by the insertion after item 1 of the following items: |
"1A. Relationship between Act and Financial Sector Regulation Act
1B. Regulatory instruments";
| (b) |
by the substitution for items 18 and 19 of the following items: |
"18. Functions of Auditor in relation to Authority
19. Submission of documents to Authority";
| (c) |
the insertion after item 40 of the following heading and items: |
"‘CHAPTER VIIA
CO-OPERATIVE FINANCIAL INSTITUTIONS
40A. Application for registration as co-operative financial institution
40B. Requirements for registration
40C. Registration of co-operative financial institution
40D. Suspension of registration or de-registration
40E. Repayment of deposits on deregistration or lapsing of registration
40F. Winding-up or judicial management of co-operative financial institution"; and
(d) the substitution for item 77 of the following item:
| "77.
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Unlawful use of words "co-operative bank", "co-operative financial institution" or unlawful conduct of business of co-operative bank or co-operative financial institution". |
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Statistics Act, 1999
